IBM Study Predicts Collaboration, Analytics And Cloud Computing As Drivers Of Growth In Midmarket

Recently, IBM released a study that talked about how midmarket organizations view IT in 2011. As US and rest of the world emerge from one of the worst economic troubles they have ever encountered, organizations are opening up their wallets for spending. IBM tried to find out the purchasing patterns, business issues and technological challenges affecting the mid-sized organizations. They surveyed more than 2000 businesses in the midmarket and released their findings as a report.

Some of the key findings in the report are:

• Compared to 18 months ago, when their main focus was on cost and efficiency, 80% of these organizations, with a much healthier budgets, are focussing on how to grow, how to connect with customers and how to innovate
• 70% are actively pursuing business analytics to gain greater insights from the mountains of data being generated
• 66% are embracing the benefits of cloud computing to optimize costs and redundancy while increasing uptime and scalability
• 70% are seeking local business partners with industry expertise and staying power for more of a consultative – versus a purely transactional – relationship (well, this is more of a self serving data than anything else but still interesting)

As I always do with any vendor sponsored study, I take these numbers with a pinch of salt. However, some of the trends observed in the study are comparable trends observed by me and other analysts in the field. Even though they are still focussed on efficiency, there is a clear shift towards accelerating innovation with the reduction in budget pressures. Some of the business priorities identified in the survey are:

• Cost reduction/Improved efficiencies – 76%
• Improved customer services – 73%
• Increased employee productivity – 70%
• New ways to reach customers – 67%
• Optimizing key business processes – 62%
• Increased insights for better decision making – 62%
• Increased flexibility and nimble enterprise – 60%
• Collaboration – 58%

Based on these priorities, mid-sized businesses are planning for:

• 75% have started or intend to start improvements in their IT infrastructure so as to ensure flexible, resilient, scalable and secure IT systems
• 70% have started or intend to start on collaboration to drive innovation, improve employee productivity and better focus on customers
• 70% have started or intend to start on business analytics to get more insight from their data and have actionable intelligence
• 67% have started or intend to start on virtualization, 66% on cloud computing and 65% on SaaS to take advantage of shared infrastructure to improve efficiencies, lower costs and improve scalability

These results and other results can be found in the report available here.

In short, like other studies we have seen in the field, 2011 is expected to improve not only the economic outlook of these organizations, it also defines how these organizations have grown smarter to spend their IT budget in a more effective manner than in the past. Their focus on technologies like cloud computing, business analytics, collaboration, etc. not just to achieve efficiencies but also to innovate bodes well for them and, more importantly, these technologies have become so affordable that even midmarket companies can tap them to their advantage.

Related articles

• Survey: midsize businesses investing heavily in analytics, cloud (zdnet.com)
• Research Report: 2011 Cloud Computing Predictions For Vendors And Solution Providers (enterpriseirregulars.com)
• Cloud Computing Baffles Midmarket (informationweek.com)
• 53% Midsize Businesses Plan To Increase IT Spend (informationweek.com)
• The Cloud & Its Impact (cloudave.com)